Fired prosecutor will reopen Odebrecht case as head of intelligence unit

Company executives have said that bribes were paid to secure Mexican contracts

Published on Wednesday, September 19, 2018

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Mexico’s former electoral crimes prosecutor, fired by the current federal government, has vowed to reopen the corruption investigation involving Brazilian construction company Odebrecht.

Santiago Nieto, who has been chosen to head the Finance Secretariat’s Financial Intelligence Unit, told the news agency Reuters that it was “shameful” how little had been done to investigate bribes that Odebrecht executives said were paid to secure public infrastructure contracts in Mexico.

The federal Attorney General’s office (PGR) dismissed Nieto in October 2017 supposedly for violating its code of conduct, but his removal came just two days after the newspaper Reforma published the ex-official’s revelation that he had received a letter from former Pemex CEO Emilio Lozoya pressuring him to clear his name of corruption allegations.

Lozoya was accused of accepting US $10 million in bribes from Odebrecht in exchange for the awarding of a contract for work on a refinery in Tula, Hidalgo, and later funneling funds to the Institutional Revolutionary Party (PRI) to help finance President Enrique Peña Nieto’s 2012 election campaign.

Nieto claimed in March that the investigation into Lozoya was the real reason he was fired and says his dismissal was illegal.

“It’s shameful that Mexico and Venezuela are the only countries in Latin America that haven’t sanctioned anyone,” he said Friday in reference to the Odebrecht case, which has claimed the scalps of high-ranking politicians in countries including Brazil, Ecuador, Colombia and Peru.

“In the case of Odebrecht, and in any other case, the first thing we would have to do is review what there is in the Financial Intelligence Unit related to the case,” he added.

Nieto, rehired by president-elect Andrés Manuel López Obrador, will not have access to files and records held by the unit until after López Obrador is sworn in on December 1.

Nieto also spoke more widely this week about government corruption, which he described as “one of the central problems” Mexico has faced over the past six years.

Questioned about accusations of massive embezzlement leveled at Agrarian Development and Urban Planning Secretary Rosario Robles, the former special prosecutor agreed with López Obrador’s recent assessment that she is a scapegoat.

“The term scapegoat [applies] in so far as she is not the only person responsible and the important thing is to find all people responsible in the system of corruption that was developed in the country, looking both to the top and the bottom [of the government hierarchy],” Nieto said.

He added that all cases of government corruption detected by the Federal Auditor’s Office (ASF) have to be investigated, adding that Mexico is ranked 135th out of 180 countries on Transparency International’s Corruption Perceptions Index (the lower the ranking, the more corrupt a country is considered).

“It’s important to reverse this perception and it can only be done through the fight against corruption and impunity,” Nieto declared.

Official statistics show that the federal government seized just 871 million pesos (US $46.35 million) and US $14.7 million as a result of corruption investigations between September 2017 and June 18, which Nieto called a “terrible” outcome.

López Obrador made combating corruption and ending impunity central to his campaign and has pledged to fight financial crime and tighten money laundering, banking and tax regulations, although he has given few details about how he will achieve it beyond holding himself up as an example to follow.

Once in office, however, he will face a public that is both fed up with the corruption scandals that plagued the current government and expects AMLO, as the president-elect is commonly known, to achieve quick results.

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